Check the Terms, Not Just the Product Name
A card loan is a long-term card loan, while a cash advance is a short-term card loan. Revolving credit is an agreement that carries part of your payment balance over to the following month. Actual interest rates and fees vary by person and product, so check the applicable rate, balance, and minimum payment in your card statement and contract.
First Decide Whether You Can Make This Payment on Time
Record the balance, annual interest rate, next payment date, minimum payment due this month, and delinquency status for each card issuer. Subtract essential expenses such as housing, food, and utilities from your monthly income, then calculate how much you can pay this month. If you cannot cover the minimum payment or expect to become delinquent, contact your card issuer before prioritizing debts by interest rate.
If You Are Not Delinquent, Set a Repayment Order
While keeping up with the required payments on every debt, putting any remaining money toward the debt with the highest interest rate can help reduce total interest. Paying off the smallest balance first may make it easier to stay on track, but if a debt is already delinquent or involves collateral or a guarantee, seek counseling before relying on a simple interest-rate order.
Compare Total Cost, Not Just the Monthly Payment, When Refinancing
Even if a new loan appears to have a lower interest rate, extending the repayment period or adding an early repayment penalty and other fees can increase the total cost. Before deciding, confirm whether the loan will actually repay your existing debts, whether the rate is variable, and the monthly payment and total repayment amount.
Practical Ways to Prevent Further Use
Keep only automatic payments that are essential for daily life, and check your card limit and revolving credit status. Reduce card use, but do not cut off essential expenses such as housing, food, or medical care. If your budget is already in deficit, counseling is usually better than trying to solve the problem through expense tracking alone.
You Can Seek Counseling Before Delinquency
Depending on the length of delinquency and your repayment ability, the Credit Counseling & Recovery Service offers programs such as rapid debt adjustment, pre-delinquency debt adjustment, and personal workouts. These differ in process and effect from personal rehabilitation and bankruptcy through the courts. Do not rely on fixed reduction rates found online; check whether you qualify by calling 1600-5500 or visiting the official website.